Prime Minister Justin Trudeau said this month’s Throne Speech will lay out an agenda that is both ambitious and responsible, as he faces competing calls to either wind down emergency spending or push ahead with a major expansion of Canada’s social and environmental programs.
Mr. Trudeau said Wednesday that he does not want to see a federal election this fall, but that opposition parties will have the opportunity to trigger one when MPs vote on the speech at some point after it is delivered on Sept. 23.
“We are working with the public service and all of the different departments to develop an ambitious and responsible plan to address COVID-19, to lay out a road map for our government for the coming years, to rebuild our economy so that it comes back stronger. And we will do that while looking for the support of all parliamentarians in order to have the confidence of the House of Commons," he said.
The Liberal government’s decision to spend unprecedented amounts on emergency-support measures for individuals and employers during the initial months of the pandemic generally received broad support from across the political spectrum and from Canada’s major business and labour organizations – even though some specific programs faced criticism over details and delivery.
Yet as Mr. Trudeau prepares to outline a second phase of stimulus later this month through the Throne Speech, that political consensus is starting to break down.
Some business leaders are expressing concern about the long-term consequences of a federal debt that will soon exceed $1-trillion, while labour and environmental groups are urging Mr. Trudeau to seize the moment by launching major new programs aimed at social and environmental concerns.
Even some Liberals are sounding the alarm over recent signals from Mr. Trudeau and Finance Minister Chrystia Freeland suggesting that the Throne Speech will signal more deficit-financed spending to stimulate growth while delivering on Canada’s climate goals.
“I think that could be a colossal mistake,” former Liberal finance minister John Manley said this week on a CBC News political panel. "I think that there’s a reckoning coming, I hope not too soon. And I think the government would be very well advised to think carefully about the signals they send about their fiscal management.”
This year’s federal deficit was projected to reach $343.2-billion at the time of the July 8 fiscal snapshot. Further spending announcements since then suggest that the projected deficit is likely approaching $400-billion. The federal government has yet to table a budget this year, meaning it has not released any fiscal projections for the size of the deficit in future years.
New Conservative Leader Erin O’Toole told The Globe and Mail last week that a Conservative government would aim to balance the books in about a decade. Mr. O’Toole also expressed concern that the Liberal government appears to be planning an agenda that is too narrowly focused on climate change, which, he said, could leave out sectors such as oil and gas, manufacturing and small business.
NDP Leader Jagmeet Singh said Wednesday that the NDP wants to see an economic recovery that puts people at the centre of the plan, including efforts to build more sustainable communities.
“We think it could be an opportunity to also fight the climate crisis,” he said.
Mr. Singh cited examples such as programs to support retrofits for homes and buildings to help create jobs and funding for public transit to help people get around and reduce emissions.
Robert Hornung, president and chief executive of the Canadian Renewable Energy Association, is also urging the federal government to move aggressively on climate change this fall and said all sectors of the economy can benefit from emission-reduction incentives.
“If we’re going to successfully transition to a low-carbon economy, that’s something where we need to be able to see opportunities for all parts of the economy to participate in that transition,” he said. The association, which advocates for solar and wind power, has provided MPs with several policy recommendations, including incentives for retrofits and increased use of solar power for homes and businesses.
Canadian Labour Congress president Hassan Yussuff said he supports programs that create jobs while reducing emissions. He is also urging the government to make permanent changes to the Employment Insurance program so that it is easier for Canadians to access and that it has a clear option to fund retraining.
“There’s tons of workers who are not going back to work after COVID because the jobs are gone. The bigger question is how do we help them improve their skills?” he said in an interview.
Earlier in the pandemic, Mr. Yussuff worked directly with Canadian Chamber of Commerce president Perrin Beatty to make joint policy recommendations by phone directly to Mr. Trudeau. That level of business and labour co-operation hasn’t been happening lately as corporate Canada expresses growing concern over Liberal government signals that it will double down on major deficit spending.
“Restoring the economy is an ambitious agenda and I would hope we would focus on that,” Mr. Beatty said in an interview. “The Throne Speech should be setting out a coherent strategy for reopening the economy safely and for restoring business-led growth. … We cannot borrow our way to prosperity."
Mr. Trudeau told reporters in Toronto Wednesday that his government has no interest in seeking an election, adding there are still real concerns about a potential second wave of COVID-19.
“We need to be there to help relaunch our economy,” he said.
In August, the Prime Minister announced that he had requested the prorogation of Parliament to present a Throne Speech that will lay out the government’s future intentions.
The decision has prompted political parties to intensify election-readiness efforts should Canadians be returning to the polls. Opposition parties criticized the prorogation and said the government’s primary motivation was to shut down embarrassing House of Commons committee hearings into its handling of a since-terminated contribution agreement with WE Charity to run a student volunteering program.
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